lost income

Calculating Lost Income for Self-Employed Individuals After an Injury

If you have to take unexpected time off of work after a personal injury, you know how much financial stress this can cause. Even if you have paid time off available, you probably expected to use that for vacation or long vacations—not injury recovery. While calculating lost income for someone who is paid hourly or on a salary is fairly simple, it’s a little harder for self-employed accident victims.

Find out how you can prove your self-employed income after an injury. When you’re ready to start your personal injury claim, we’re ready to help. Call Turner, Onderdonk, Kimbrough & Howell to get started. You can reach our Chatom office at 251-336-3411 or our Bay Minette office at 251-336-3697.

The More Documentation, the Better

In general, you want to have as much documentation of your self-employed income as possible. Imagine you’re trying to get a loan based on your self-employed income—the required documentation is much more than what a traditionally employed borrower would have to provide. While this doesn’t quite rise to the level of loan documentation, you’ll want as many different types of evidence to corroborate your income claims as you can find.

The insurance company will be looking for anything they can use to decrease the value of your claim. If they cannot verify your income, they will push back as hard as they can on paying you what you claim to have lost as a result of your injury. If you can provide multiple forms of proof, including those listed below, it will be much harder for them to get away with that.

Tax Returns and 1099 Forms

Tax documentation is one of the strongest pieces of evidence you can provide when it comes to proving lost wages. It’s especially useful if you have fairly consistent earnings year after year, as it’s easier to prove that you would likely have earned the same amount if the accident had not occurred. If possible, try to go back at least three years when providing tax return forms and 1099 forms.

Monthly Invoices

Client invoices may also support your income claims. Try to provide multiple invoices from the months preceding your accident, and then back those up with invoices from the time immediately following your accident. If there’s a significant drop in the amount you were able to bill after your accident, that difference may be owed to you by the liable party. If you work in a seasonal industry, compare your invoices from the year of the accident to those in the same month from years prior.

Client Contracts and Statements

If you have contracts with current clients, make sure to include those as part of your evidence. Contracts often include specific information on how much you’re paid and how much you’re expected to deliver. If you were unable to deliver the required services or goods as a result of your injury, that’s a clear and unavoidable loss of income.

Perhaps your work with clients comes and goes. If you were in the middle of a project when you got injured, you may be able to ask for a statement from your client. This may include information on what the project was worth, how much money you lost because you were unable to complete it, and the fact that they had to then hire someone else.

Don’t forget to bring up losses from new clients. Perhaps you were starting work with a new client when you were injured but found yourself unable to finish the work because of your accident. Without an established relationship with a client and an abrupt cancellation, it’s unlikely that you’ll keep them as a client—even if your inability to finish the work was completely out of your hands. Discuss this with your attorney to find out how much compensation you may be owed.

Choose Turner, Onderdonk, Kimbrough & Howell for Your Injury Claim

The longer you wait to pursue a personal injury claim, the less evidence you may have available to you. Let’s talk about your options and make a plan. You can reach us online, call our Chatom office at 251-336-3411, or calling our Bay Minette office at 251-336-3697.

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